LONDON-STANSTED-CAMBRIDGE POTENTIAL GROWTH AREA

  This evidence is submitted on behalf of the East of England Regional Assembly (EERA) and East of England Local Government Conference (EELGC—the present Regional Planning Body [RPB]). It relates solely to the London-Stansted-Cambridge potential growth area.

BACKGROUND

  1.  The area focused broadly upon Stansted Airport was identified as a potential growth area in Regional Planning Guidance for the South-East (RPG9, published March 2001) which stated that:

"An interregional study should be undertaken to investigate what the nature, possible extent and location of future growth might be within the London-Stansted-Cambridge area."

  2.  EELGC/EERA co-operated with local authority and stakeholder partners in preparing such a study, and the final report "London-Stansted-Cambridge Sub Regional Study: Spatial Patterns Explored" was completed in July 2002.

  3.  EELGC is preparing Regional Planning Guidance (RPG14) for the new East of England region and is currently consulting the public and stakeholders on RPG Options, including the London-Stansted-Cambridge study. EELGC recognises that the area is of significant economic importance regionally and nationally and that growth would provide an opportunity for the long-term restructuring of the region and provision of improved east-west links. However, EELGC has not made any formal response to the study, and cannot until consultation is completed (16 December 2002) and public comments analysed. This initial submission therefore addresses the Select Committee's questions mostly in general terms.

Question: The overall scale of housebuilding required

  4.  The Deputy Prime Minister's statement did not apportion the increase in housebuilding between the four potential growth areas. Neither did it distinguish between existing housing allocations and potential future allocations.

  5.  The London-Stansted-Cambridge study does not offer a preferred solution. Instead it offers:

i.  four possible spatial patterns for growth, which can be characterised as:

—  continuing existing settlement patterns;

—  focusing on regeneration areas (Harlow and Lee Valley);

—  focusing on strongest economies (Cambridge and Stansted); and

—  new settlements/towns.

ii.  three possible levels of growth, which can be characterised as:

—  continuing present growth rates;

—  regional growth, based on rates slightly higher than present; and

—  maximising economic growth, ie regionally/nationally significant high growth rate.

  6.  EELGC/EERA accepts the importance of increasing the supply of housing, particularly affordable housing, in the short to medium term. This needs urgent action by all those bodies involved with delivery on the ground. The local authorities would be happy to explore mechanisms to speed up the implementation of existing plans, for example as is already happening in the Cambridge sub-region.

  7.  However, proposals for major growth in the London-Stansted-Cambridge corridor pose significant spatial planning challenges:

(i)  the levels of growth set out in the London-Stansted-Cambridge study's higher growth scenarios are significantly higher than historic growth rates—more than three times as high as has recently been achieved. Table 1 demonstrates this:

(ii)  Accommodating major growth poses locational challenges, because the key economic drivers for growth in the corridor are Cambridge, Stansted Airport, and central London/Docklands.

(iii)  The Cambridge Sub-Region is already subject to significant long-term growth proposals flowing from RPG6 (East Anglia, approved November 2000) and now being taken forward in the Cambridgeshire Structure Plan review. It is unlikely that the Cambridge area could accept further major growth without harm to the economic and environmental features that make it attractive;

(iv)  The Stansted area has limited capacity for urbanisation. It has a dispersed pattern of small towns and villages, surrounded by high quality countryside and agricultural land. These settlements have already expanded significantly to serve both local needs and Stansted Airport expansion. Their ability to grow further without significantly harming either their attractiveness to economic development, sustainability, or the surrounding countryside/rural economy, is extremely limited. Development of new settlements in the area would relieve pressure on existing settlements, but would only be feasible at higher levels of growth, and would have significant countryside, rural and possibly Green Belt impacts, and could raise significant sustainability issues. It would also affect existing settlements in the immediate vicinity of any potential site, which is already generating concern and controversy in the region.

(v)  The area has inadequate transport infrastructure. Road and rail routes are predominantly north-south (M11 and WAGN line) with very poor east-west links. The north-south routes are used to capacity for London commuting during the daily peak periods. Infrastructure to support Stansted Airport expansion has consistently lagged many years behind need. The M11 has hitherto been designated by Government (and local government) as primarily a movement corridor, and development has been resisted to protect this role.

(vi)  Regeneration of Harlow, the Lee Valley and north-east London down to Stratford and the Thames is critical to all growth options for the corridor. In principle, regeneration and major growth in these areas could be related to the economic growth potential of Stansted Airport, and the Lee Valley Regional Park could provide a framework for high quality sustainable development. However, major growth at Harlow and in the Lee Valley could have Green Belt impacts. They are also distant from Stansted. Harlow is about 12 miles south, and the Lee Valley 25-30 miles. It would only be acceptable to create new commuter flows on this basis if extremely high quality, affordable public transport could be provided. It is arguable that restraint on private car-based transport would be needed to make this work. Even with successful public transport provision, any large scale affordable housing provision—ie housing occupied by key workers and people on low incomes—would be distant from a key source of employment.

(vii)  London provides the other economic growth driver for the corridor, but could only sustain significant housing development in the East of England region if a significant increase in commuting could be accepted. The figures shown in Table 1 above exclude potential housing growth within the GLA area. The London-Stansted-Cambridge study also suggested the potential for providing between 117,000 and 200,000 dwellings in London, additional to the figures in Table 1. While significant public transport investment is planned or proposed that could serve this growth (mainly the Crossrail 2 proposal), EELGC has objected to the Mayor of London's "London Plan" on the basis that the schemes are being proposed as London-focused Metro systems that would not adequately support areas outside London.

Question: Are the proposals likely to significantly reduce house prices

  8.  The London-Stansted-Cambridge study noted that:

"There is some debate about how much effect on prices increasing the supply of residential land would have—especially in the short term and in the context of constrained supply throughout the South of England. However, there is no doubt that the relative level of supply also has a major influence on land and property prices in the long run—especially if this is part of a region-wide response."

  9.  EELGC/EERA is aware of a research study[23] undertaken by the former Department of the Environment, in the early 1990's, which suggested that house prices in the South-east could be reduced by new housing supply only if the scale of development were very large and fairly generally distributed across the South-east.

  10.  The London-Stansted-Cambridge study consultants noted that:

"The scale and speed of development required by the higher growth scenarios poses a formidable challenge to the development industry[24]; and indeed to other supply sectors in the economy (training, transport etc). Regeneration and development will not be easy in a number of the areas (Lee Valley, major regeneration of Harlow, provision of local transport systems etc.) and the report suggests the need to look at special delivery mechanisms and institutions to ensure that the required time-scale is met."

  11.  EELGC/EERA is therefore concerned that major development in the potential growth areas could only reduce house prices at the expense of considerable conflict with economic and environmental pressures. It may also be beyond the ability of the development industry to deliver. If this proved to be the case, high rates of growth would need direct Government intervention in planning and building major development and/or new towns.

  12.  EELGC/EERA is also concerned that growth should not be housing-led. Whatever level of development is proposed must be based on a balanced package of employment and housing development. To proceed otherwise would create unsustainable development and transport patterns, and would frustrate, rather than achieve, the Government's aim of creating sustainable communities.

Question: The geographical distribution of new housing, including plans to concentrate development in the South East in four growth areas, Milton Keynes, the Cambridge/Stansted Corridor, Ashford and the Thames Gateway

  13.  Achieving the right location for housing development within the study area is vital. The Deputy Prime Minister's statement focuses on housing provision but this must be seen in the context of an overall strategy for the study area. New housing must be located close to jobs and areas of job potential. It must also be located where major investments in public transport and road infrastructure are planned. Otherwise new housing will not meet the needs identified by Ministers and will create unsustainable commuting travel, congestion and environmental harm. RPG14 will seek to deliver such an integrated long-term strategy.

  14.  Housing alone is not the answer for those areas, such as Harlow, in need of regeneration. Investment is needed in physical and social infrastructure and jobs to support existing communities, which may then enable further, sustainable residential growth.

  15.  Growth at Stansted will have a major impact on the economy, housing and transportation of the region. The SERAS White Paper expected in mid-2003 will contain the Government's proposals. These may have a major bearing upon the pressure for and ability of the corridor to accommodate major housing and employment growth. It may also have a major impact on infrastructure needs.

Question: Whether the proposals will promote high quality sustainable communities whilst avoiding poorly designed urban sprawl

  16.  This issue is addressed in response to the question on "the overall scale of housebuilding required".

Question:  Proposals for new Millennium Villages

  17.  EELGC/EERA has no experience of such developments. However, the RPG14 Options Consultation invites public comments on the possibility of concentrating a significant proportion of future growth in a major new town (or several smaller new towns of equivalent overall size). It makes clear that if such an option were pursued it would have to deliver a highly sustainable development, with maximum opportunity for economic growth and/or regeneration, and that good public and private transport links and high environmental quality would be essential.

  18.  Most Millennium Villages built or proposed so far are considerably smaller than those implied by the Deputy Prime Minister's statement and the London-Stansted-Cambridge study. If a new town option were selected for the East of England, the level of growth needed could be nearer to the scale of a large new town.

Question: The balance of new development between housing for sale and social housing

  19.  The term "social housing" does not encapsulate the full range of affordable housing issues. We use the definition given in Circular 6/98:

"the terms affordable housing or affordable homes . . . encompass both low-cost market and subsidised housing (irrespective of tenure, ownership—whether exclusive or shared—or financial arrangements) that will be available to people who cannot afford to rent or buy houses generally available on the open market".

  20.  RPG9 set a target of 18-19,000 affordable homes per annum for the areas outside London. This equated to a target of 46-49% of total supply. EELGC's first Annual Monitoring Report (2001) showed that affordable housing makes up about 13% of total supply—though this misses out much low cost market housing, which is difficult to identify. The need for affordable housing is the subject of continuing research, but is believed to be at least 20% of total supply, and possibly higher in some areas.

  21.  The delivery of affordable housing rests on three key sources:

(i)  direct provision by Local Authorities and Registered Social Landlords (RSLs) relying upon Housing Corporation finance;

(ii)  provision by developers within market housing developments (though this usually also relies on the availability of an RSL to manage the housing in the longer term). This provision is usually secured by S.106 agreements[25]; and

(iii)  contributions by developers in the form of cash or land, also usually secured by S.106 agreements.

  22.  The reliance on delivery of affordable housing via S.106 agreements is a great weakness. This is a major subject in its own right, and EELGC (and SEERA[26]) submitted reports on this issue to Lord Rooker earlier this year. In brief, provision via S.106 agreements:

(i)  cannot meet all needs for affordable or key worker housing;

(ii)  is time-consuming and fraught with risk of failure;

(iii)  imposes a significant burden upon private developers;

(iv)  is frequently frustrated by the lack of Housing Corporation or other funding to enable an RSL to manage the housing;

(v)  cannot be applied to developments below certain threshold sizes, such that many developments make no contribution at all[27];

(vi)  are particularly difficult to secure for developments on brownfield or recycled land, as developers' ability to provide is often more limited, and many such sites fall below the thresholds (sub-para v. above).

Question: The extent to which decisions relating to housing, including numbers, tenure and density, should be taken by central and local government

  23.  EELGC/EERA considers it essential that decisions on these issues should initially be taken by local government, via the plan-led system, for the following reasons:

(i)  As indicated above, DPM's statement focuses on housing provision but this must be seen in the context of an overall strategy for the study area. Housing and jobs need to go hand-in-hand otherwise increased (and unsustainable) commuting will result;

(ii)  Development of a strategy for the study area will be built into the RPG 14 process. As indicated earlier, EELGC is currently consulting on options. We aim to submit Draft RPG14 to ODPM by June 2003 and are currently on target. Final RPG14 should be completed by the second half of 2004 (in line with ODPM target).

(iii)  Stakeholders are expecting full consultation before proposals for the corridor are finalised. The London-Stansted-Cambridge study included a number of consultation events, and consultees expect further consultation as part of the RPG process;

(iv)  It is vital, for the credibility of this and future studies, that its outcome is not seen as a "done deal" before the consultation processes have been completed. It is also important that the key players are signed up if the strategy is to work;

  24.  The overall democratic process is, therefore, vital. The RPG process provides for policy to be prepared by representatives of accountable public bodies, while EELGC/EERA is also following an inclusive process with stakeholders. The process further affords opportunities for formal public objection and the opportunity to submit evidence, either in writing or in person, to a Public Examination, and to object to proposed changes after that stage.

  25.  While mindful that the DPM has published proposals for reform of the planning system to speed up development, the subsequent stages in the planning process will also afford opportunities for public scrutiny of the more detailed stages of development. It is vital that proposals be subject to such scrutiny, to ensure public credibility, support, and hopefully acceptance and buy-in. Any suggestion that the proper democratic process will be undermined needs to be avoided.

23   We believe the study was titled !The Relationship between house prices and land supply" but do not have a copy of it available to us. Back

24   Our emphasis. Back

25   S.106 Town & Country Planning Act, 1990. Back

26   South East England Regional Assembly. Back

27    Back